Hedging is the practice of holding securities or investment positions in order to reduce damage that might be a result in a volatile market. There are many hedging strategies that an investor can use in order to reduce risk in volatile times. These Securities that offer hedge are securities that move against the current of the market trends. With that here are the most common hedging strategies that an investor may use.
Common Hedging Strategies
1) Calendar Spreads – this Strategy is created by investing into a long-term option that will replace a short-term put option with the same strike price. Calendar Spreads decrease cost of adding a few more months into a put option which will also create an opportunity to put a cheap hedge in place at a future date. Click here to read about Apple shares fall as iPhone sales take a surprise dip.
2) Put Rolling and Time Extension – this is a strategy where in an investor purchases the longest available put option. This is because marginal cost of each additional month generally has a lower strike price than the month before.
3) Spread Hedging – spread hedging is when the investor buys a position with a higher strike price and sells one that has a lower price with the same time expiration date. This provides investors with a limited protection, as the maximum payout from both positions will only be the difference between the two strike prices.
Conclusion
There are many more hedging strategies that are available for investors to choose from. But hedging in general has one goal that is to reduce the loss in times of volatility in the market.
Some investments are easier to hedge than others, more often, investments like broad investments are cheaper to hedge than individual stocks and lower volatility in the market makes the put option less expensive.
The leading firm Caps Solutions Ltd operates with the trading name PrimeFin in the financial market. PrimeFin Review 2021 is a well-regulated brokerage firm working under the guidelines of Labuan. Some of the company’s credentials are:
The regulatory agency of PrimeFin: Labuan Financial Services Authority (LFSA)
Registration number: 12734767
Official address: Unit B Lot 49, 1st Floor, Block F, Lazenda Warehouse 3 Jalan Ranca Labuan Malaysia
PrimeFin is specially designed around the core and simple idea that highly focuses on trading assets’ speed. It helps investors in the best possible way to keep pace with the dynamic and price shift of the market.
It provides various benefits such as large control over the bids, instant trading over 10,000 markets, fast and simple registration and real-time data of the market. Click here to read about Top Ethereum & Bitcoin Wallet: 2021 Edition.
The broker has an efficient team working round the clock to deliver the best services along with the fast market movement information.
Trading features:
Instant trade execution
Fast deposit and withdrawals
Cross-functional platform
Trading apps supported on multiple devices
Around 350 tradable assets
Instant access to 10,000 market
Excellent customer support team
Exceptional Trading Conditions
Minimum Deposit 250$
Exciting and affordable trading range:
Zero commission on trading
Minimum pip: 0.03
Maximum leverage for starting a trade: 1:100
Is PrimeFin Scam or Safe?
PrimeFin broker is a trading name of Caps Solutions UK Ltd, which operates from Malaysia with the registration no LL16622. The broker is highly regulated and authorised by the Labuan Financial Services Authority (LFSA) under license number 12734767.
Moreover, the broker follows all the rules and regulations of the financial bodies like the EU, MiFID, and Investors Compensation Fund (ICF). It also uses an advanced data encryption system to prevent all the data of its valuable customers.
Overall, PrimeFin is considered the best and safest online trading platform for traders.
How many Trading Accounts Types Does PrimeFin Offer?
The next point in the PrimeFin review of 2021 is the types of accounts. The broker provides three customised accounts for your most unique trading style. It believes that the trading should be as fast as the blink of an eye and highly responsive to the global market shifts.
The forex traders can benefit from core account types like gold account, silver account and platinum account. Each of these accounts corresponds to your trading expertise, skills, ambitions and strategies.
The Broker also offers a demo account for novice traders to start their forex trading journey, and to understands the dynamics and try different trading strategies.
Gold account
Features of the Gold account
Leverage for trading: 1:100
Discount on swaps up to twenty-five per cent
Protects you from the trade risk (Hedging)
Account manager for solving trading related issues
Fifth decimal
Latest investment news
Base currencies available with the broker: AUD/USD, EUR/GBP, USD/CAD, USD/CHF/ NZD/USD, EUR/USD, USD/JPY, GBP/USD and some more.
Platinum account
Leverage for trading: 1:100
Discount on swaps up to twenty-five per cent
Protects you from the trade risk (Hedging)
Account manager for solving trading related issues
Fifth decimal
Latest investment news
Base currencies available with the broker: AUD/USD, EUR/GBP, USD/CAD, USD/CHF/ NZD/USD, EUR/USD, USD/JPY, GBP/USD and some more.
Silver account
Leverage for trading: 1:100
Protects you from the trade risk (Hedging)
Account manager for solving trading related issues
Latest investment news
Base currencies available with the broker: AUD/USD, EUR/GBP, USD/CAD, USD/CHF/ NZD/USD, EUR/USD, USD/JPY, GBP/USD and some more.
What kind of Trading platform does PrimeFin offer?
PrimeFin has made trading simple for you by offering digital trading platforms that are compatible with mobile and web browsers. You can access your trading account anytime from any place and can pursue trading with just one single click.
The two basic options for trading with PrimeFin are the advanced Web Trader and MetaTrader 4 Mobile app.
Key highlights of PrimeFin trading platform
Dedicated customer support team with a live chat option
Free availability of educational material
Real-time account balance check
For comparing different assets, you can access multiple chart windows.
Switch account in just one single click
Integrated platform support
Notification for price alerts
Automatic profit functions and stop-loss function
Web Trader
Below are some features of Web Trader
Various execution modes: Customize your trading by selecting among some top variants, including four pending, two stop orders, four pending, and trailing stop functional and instant execution.
Trading on one single click: You can open or close your trading position with just one single click on your trading page.
List of your past orders: You can instantly check all your bids and trades. Additionally, you can analyse the market shift, monitor your activity, and keep full track of your order and market success.
Analytical toolkit: You can get instant access to Japanese candlestick charts, Fibonacci retracement and several more without paying a single penny.
Mobile app
Below are some features of the Mobile app
Trading on one single click: You can open or close your trading position with just one single click on your trading page.
Nine different timeframes: Nine different time frames allows you to grab a wide range of your bids. These include M30, M15, M5, M1, H4, H1, MN, W1, and D1.
More than 60 tools for analysis: You can get instant access to Japanese candlestick charts, Fibonacci retracement and several more without paying a single penny.
Instant notifications: This feature brings out the latest price shifts, market movement or any events happening around the financial market.